The Morris County housing market got off to a strong start in 2017, with an increase in sales activity coupled with some promising signs for pricing.

Sales. Morris County sales were up solidly, rising almost 9% from the first quarter of last year. This continued a streak in which year-on-year sales have now gone up for 10 straight quarters, over two years of sustained buyer demand. Transactions were also up 10% for the year, and are now up almost 60% from the bottom of the market in 2011. So sales have been strong for several years now, indicating sustained levels of buyer demand.

Prices. These persistent levels of buyer demand are finally having some modest impact on pricing. For the first time in several years, the average price was up, rising a little over 1%. And even though the median was down 1%, and the yearlong price trend is negative, we believe that sustained buyer demand coupled with falling inventory is likely to drive pricing up through the rest of the year.

Inventory. Morris inventory fell again, dropping over 34% from last year’s first quarter and now down to just over six months worth of inventory . We measure “months of inventory” by calculating the number of months it would take to sell all the available homes at the current rate of absorption, and generally consider anything below six months to signal a seller’s market that would normally drive prices up. So the fact that Morris inventory is now close to that six-month mark indicates that we could be in for some meaningful price appreciation in 2017.

Negotiability. The negotiability indicators showed that sellers are starting to gain leverage with buyers. The days-on-market indicator was down by 15 days, falling over 10%, indicating that homes were selling more quickly. And the listing price retention rate continues to rise, now up to just about 97% for the quarter and the year, signaling that sellers are having more success getting buyers to meet their asking prices.

Going forward, we expect that Morris County’s sales activity will eventually have a more meaningful impact on pricing. With homes still at historically affordable prices, interest rates low, and a generally improving economy, we believe that reduced inventory, coupled with rising buyer demand, will drive price appreciation through a robust Spring market and the rest of 2017.

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The Northern New Jersey housing market surged ahead in the first quarter of 2017, starting the year with a dramatic increase in home sales coupled with modest-but-meaningful signs of price appreciation. With inventory levels continuing to fall throughout the region, we expect that sustained buyer demand will drive a robust seller’s market through the Spring and the rest of 2017.

Sales surged throughout the region. All the Northern New Jersey markets got off to a strong start to the year, with regional sales up almost 12% and transactions rising in every market in the region: up 1% in Bergen, 30% in Passaic, 8% in Morris, 12% in Essex, and 32% in Sussex. For the rolling year, sales were up over 9%, reaching sales levels we have not seen since the height of the last seller’s market. Indeed, regional sales are now up over 65% from the bottom of the market in 2011.

The number of available homes for sale continues to go down. We measure the “months of inventory” in a market by looking at the number of homes for sale, and then calculating how long it would take to sell them all given the current absorption rate. The industry considers anything fewer than six months to be a “tight” inventory that signals the potential of a seller’s market that would drive prices up — and we’ve now seen this market cross below that line for the second quarter in a row. Indeed, inventory was down from last year in every individual county in the Report: Bergen single-family homes down 21%, and condos down 34%; Passaic down 38%; Morris down 34%; Essex down 39%; and Sussex down 36%. If inventory continues to tighten, and demand stays strong, we are likely to see more upward pressure on pricing. With sales up and inventory down, prices are starting to show some “green shoots” of modest price appreciation. Basic economics of supply and demand would tell us that after five years of steadily increasing buyer demand, we would expect to see some meaningful price increases. And we’re beginning to see some promising signs: the regional average sales price was up almost 1% from last year’s first quarter, and the average price was up in almost every county in the report.

Going forward, we remain confident that rising demand and falling inventory will continue to drive price appreciation through the rest of 2017. Sales have now been increasing for five years, which has brought inventory to the seller’s market threshold in much of the region. The economic fundamentals are all good: homes are priced at 2004 levels (without even adjusting for inflation), interest rates are still near historic lows, and the regional economy is stable. Accordingly, we continue to believe the region is poised for a robust Spring market and a strong 2017.

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The Morris County housing market finished the year with a sharp increase in sales, but sustained buyer demand throughout 2016 still has not had a significant impact on pricing.

Sales. Morris County sales were up significantly, rising almost 12% from the fourth quarter of last year. This continued a streak in which year-on-year sales have now gone up for nine straight quarters, over two years of sustained buyer demand. Transactions were also up 12% for the year, and are now up about 56% from the bottom of the market in 2011. So sales have now been strong for several years, indicating that buyer demand is growing.

Prices. All this sales activity, though, has not yet had its expected impact on pricing. Prices were mostly mixed for the quarter, falling over 2% on average even while the median was flat. For the year, prices were stubbornly resistant to the increasing buyer demand, falling almost 3% on average and 1% at the median. This was surprising and disappointing, particularly after the modest price appreciation that we saw in 2015.

Inventory. Morris inventory fell again, dropping over 26% from last year’s fourth quarter and now down to 7.3 months. We measure “months of inventory” by calculating the number of months it would take to sell all the available homes at the current rate of absorption, and generally consider anything below six months to signal a seller’s market that would normally drive prices up. So the fact that Morris inventory is now down to just over seven months of inventory could indicate that we will see meaningful price appreciation next year.

Negotiability. The negotiability indicators showed signs that sellers might be gaining leverage with buyers. The days-on-market indicator was down by nine days, falling almost 7%, indicating that homes were selling more quickly. And the listing price retention rate continues to rise, now up to just under 97% for the quarter and the year, signaling that sellers might be having a bit more success getting buyers to meet their asking prices.

Going forward, we expect that Morris County’s sales activity will eventually have a meaningful impact on pricing. With homes still at relatively affordable 2004 prices (without even adjusting for inflation), interest rates low, and a generally improving economy, we believe that reduced inventory coupled with rising buyer demand will drive price appreciation through 2017.

To learn more about Better Homes and Gardens Rand Realty, visit their website and Facebook page, and make sure to “Like” their page. You can also follow them on Twitter.

The Northern New Jersey housing market finished strong in the final quarter of 2016, with sales up sharply even while pricing continued to struggle. But with inventory levels falling throughout the region, we expect that sustained buyer demand will drive meaningful if modest price appreciation in 2017.

Sales were strong throughout the region. After a relatively slow third quarter, regional sales surged back, rising almost 11% and up sharply in every county in the report: rising 11% in Bergen, 14% in Passaic, 12% in Morris, 11% in Essex, and 18% in Sussex. This strong fourth quarter helped the region close the 2016 year up almost 11% in sales, reaching the highest yearly transactional total in over ten years, since the height of the last seller’s market. Indeed, regional sales are now up 63% from the bottom of the market in 2011.

Inventory continues to tighten. We determine the “months of inventory” in a market by measuring the number of homes for sale, and then calculating how long it would take to sell them all given the current absorption rate. The industry considers anything less than six months to be a “tight” inventory that signals the potential of a seller’s market that would drive prices up. Well, the months of inventory for the Northern New Jersey region has now crossed over that line, dropping down to 5.3 months. Moreover, inventory was down in every individual county in the Rand Report, and is now below or nearing the six-month level: Bergen single-family homes at 3.6 months and condos at 6.1 months, Passaic at 8.3, Morris at 7.3, Essex at 7.0, and Sussex at 11.3. Certainly, if inventory continues to tighten, and demand stays strong, we are likely to see upward pressure on pricing.

Even with sales up and inventory down, though, average prices have been flat or falling throughout the region. Basic economics of supply and demand tells us that after five years of steadily increasing buyer demand, we should expect to see some meaningful price increases. But prices languished, with the regional price down just a tick from last year’s fourth quarter, but down almost 2% for the year. Moreover, the average prices for the year were down in almost all of the individual counties, rising only for Bergen condos, with just a tick up for Sussex. And maybe that’s the tell it might be that the market is simply stronger at the lower end, so lower priced homes (like Bergen condos and Sussex properties) are making up a larger percentage of the mix of properties sold.

Going forward, we remain confident that rising demand and falling inventory will drive price appreciation in 2017. Sales have now been increasing for almost five years, which has brought inventory to the seller’s market threshold in much of the region. The economic fundamentals are all good: homes are priced at 2004 levels (without even adjusting for inflation), interest rates are still near historic lows, and the regional economy is stable. Accordingly, we continue to believe that better days are ahead, and that we are likely to see modest but meaningful price appreciation in 2017.

To learn more about Better Homes and Gardens Real Estate® – Rand Realty, visit their website and Facebook page, and make sure to “Like” their page. You can also follow them on Twitter.

The Morris County housing market softened in the third quarter of 2016, with sales up modestly and prices mixed.

Sales. Morris County sales were up only slightly, rising about 4% from the third quarter of last year. Even that tepid increase, though, was enough to continue a two‑year streak in which year‑on‑year sales have gone up for eight straight quarters. The long‑term trend is also relatively encouraging, with sales up 9% for the rolling year.

Prices. This sustained increase in sales, though, has not yet had its expected impact on pricing. Prices were mostly mixed, with the average up a tick and the median down slightly. For the year, the results were a little more discouraging, with the average falling over 2% and the median down over 1%. And after some meaningful price appreciation in 2015, we have now seen prices down for most of this year. This was a little surprising, given that we’ve seen sales activity up for almost two years. Normally, rising sales activity should drive appreciating prices.

Inventory. The good news for Morris homeowners and sellers is that inventory continues to tighten. In the industry, we generally consider anything below six months of inventory as a signal for a “tight” market, leading to multiple offer situations, bidding wars, and ultimately appreciating prices. By that measure, we are certainly moving toward a seller’s market, with Morris now down to 7.3 months of inventory, falling almost 22% from last year.

Negotiability. The negotiability indicators showed only modest signs that sellers might be gaining leverage with buyers. The days‑on‑market indicator was relatively flat, falling by five days. And the listing retention rate was up just a tick, indicating that sellers might be having a bit more success getting buyers to meet their asking prices.

Going forward, we expect that Morris County’s sales activity will eventually have a meaningful impact on pricing. With homes still at historically affordable prices, interest rates low, and a generally improving economy, we believe that buyer demand will strengthen and eventually drive modest but meaningful price appreciation in 2017.

The Northern New Jersey housing market plateaued in the third quarter of 2016, with sales flattening out after a torrid start to the year and pricing struggling to gain traction. With inventory levels falling throughout the region, though, we expect that the market might gain strength going into 2017.

Sales were basically flat throughout the region. After a strong start to the year, sales slowed during the third quarter, rising only about 2%. The good news is that if you look at the rolling year, sales were up almost 10%, continuing a trend we’ve been watching for about five years. Although we are not yet at transactional levels that we saw during the last seller’s market of the mid‑2000’s, sales are up about 40% from the bottom of the market in 2009 and are moving in a positive direction.

We are also seeing inventory continue to tighten. The industry measures the impact of inventory by calculating the “months of inventory” remaining on the market: i.e., the number of homes for sale divided by the average monthly transactions. According to industry standards, six months worth of inventory signals a balanced market: any less, and we are likely to see too many buyers chasing too few homes, which will tend to lead to multiple offer situations, then bidding wars, and ultimately higher prices. And that’s about where we are trending throughout the region, with regional inventory down over 25%. Indeed, Bergen is already below six months of inventory, and Morris, Essex, and Passaic are all below nine months.

Even with sales up and inventory down, though, average prices have been dropping throughout the region. We have been a little disappointed in the pricing this year, after what looked to be “green shoots” of price appreciation toward the end of 2015. Certainly, basic economics of supply and demand would tell us that after five years of steadily increasing buyer demand, we would expect to see some meaningful price increases. It might be that the market is simply stronger in the lower‑end than the middle‑ or higher‑end, which is changing the mix of properties sold and skewing the averages. Or it could still just be a matter of time before falling inventory and rising demand starts impacting pricing.

Going forward, we still believe that we are heading for a seller’s market. Sales have now been increasing for almost five years, which has brought inventory to the seller’s market threshold in much of the region. The economic fundamentals are all good: homes are priced at 2004 levels (without even adjusting for inflation), interest rates are still near historic lows, and the regional economy is stable. Accordingly, we continue to believe that better days are ahead, and that we are likely to see modest but meaningful price appreciation in 2017.

The Morris County housing market surged again in the second quarter of 2016, with sales up sharply. Despite increasing buyer demand, though, prices still disappointed.

Sales. Morris County sales were up almost 18% in the second quarter, marking the seventh straight quarter of year‑on‑year sales growth. The long‑term trend is also encouraging, with sales up almost 10% for the rolling year. Indeed, we nearly crossed the 6,000‑transaction threshold for the rolling year, which would be the first time we hit that level in almost ten years, at the tail end of the last seller’s market.

Prices. This surge in sales activity did not, though, have its expected impact on pricing. Prices were down sharply, dropping almost 6% on average and almost 2% at the median. And after some meaningful price appreciation in 2015, we have now seen prices down for the first half of the year, driving the rolling year average price down over 3%. This was a little disappointing, given that we’ve seen sales activity up for almost two years. Normally, rising sales activity would drive appreciating prices.

Inventory. The “months of inventory” indicator measures how long it would take to sell out the existing inventory of homes at the current rate of home sales. In the industry, we generally consider anything below 6 months as a signal for a seller’s market, where tight inventory leads to multiple offer situations, bidding wars, and ultimately appreciating prices. By that measure, we are certainly moving toward a seller’s market, with Morris now down to 8.0 months of inventory, falling almost 38% from last year.

Negotiability. The negotiability indicators showed only modest signs that sellers might be gaining leverage with buyers. The days‑on‑market indicator was relatively flat, falling by just one day from last year. And the listing retention rate was up just a tick, indicating that sellers might be having a bit more success getting buyers to meet their asking prices.

Going forward, we expect that Morris County’s sales activity will eventually have a meaningful impact on pricing. With homes still at historically affordable prices, interest rates low, and a generally improving economy, we believe that buyer demand will strengthen and eventually drive modest but meaningful price appreciation by the end of the year.

The Northern New Jersey housing market continued to surge in the second quarter of 2016, with sales up sharply throughout the region. But rising levels of buyer demand are not yet having any real impact on pricing, which was flat or down in each of the counties.

Sales were up over 13% for the region, rising in every county in the Report. Closings have now been trending up for about five years, ever since the market stabilized after the correction precipitated by the financial crisis of 2008‑09. Although we are not yet at transactional levels that we saw during the last seller’s market of the mid‑2000’s, sales are up about 40% from the bottom of the market and are moving in a positive direction.

We are also seeing inventory continue to tighten. The industry measures the impact of inventory by calculating the “months of inventory” remaining on the market: i.e., the number of homes for sale divided by the average monthly transactions. According to industry standards, six months worth of inventory signals a balanced market: any less, and we are likely to see too many buyers chasing too few homes, which will tend to lead to multiple offer situations, then bidding wars, and ultimately higher prices. That’s where we are right now in Bergen and Morris, with both counties near the 6‑month threshold, and inventory in the other counties is tightening considerably.

Even with sales up and inventory down, though, average prices dropped throughout the region. We have been a little disappointed in the pricing this year, after what looked to be “green shoots” of price appreciation toward the end of 2015. Certainly, basic economics of supply and demand would tell us that after five years of steadily increasing buyer demand, we would expect to see some meaningful price increases. But appreciation still eludes us. It might be that the market is simply stronger in the lower‑end than the middle‑ or higher‑end, which is changing the mix of properties sold and skewing the averages. Or it could still just be a matter of time before falling inventory and rising demand starts impacting pricing.

Going forward, we still believe that we are heading for a seller’s market. Sales have now been increasing for almost five years, which has brought inventory to the seller’s market threshold in much of the region. The economic fundamentals are all good: homes are priced at 2004 levels (without even adjusting for inflation), interest rates are still near historic lows, and the regional economy is stable. Accordingly, we continue to believe that price appreciation is coming, and that the region will experience a robust summer market that continues throughout the rest of 2016.

The Morris County housing market recovered from some late 2015 doldrums to post a robust start to 2016, with a spike in sales. Even with this surge in activity, though, pricing was disappointing.

Sales. Morris County sales were up sharply in the first quarter, rising almost 17% for the quarter, marking the sixth straight quarter of year-on-year sales growth. The long-term trend is also encouraging, with sales up over 9% for the rolling year and now regularly clearing over 5,500 yearlong sales, which is comparable to what we saw at the tail end of the last seller’s market.

Prices. This spike in sales activity did not, though, have its expected impact on pricing. Prices were down sharply, dropping over 5% in both the average and the median. And after some meaningful price appreciation in 2015, the long-term trend turned downward, with the weak first quarter driving the rolling year average and median price into negative territory. Why would prices go down as sales go up? One explanation could be that the market was relatively stronger in the lower priced entry-level markets, which would change the mix of the properties sold and drive down the overall pricing. We will keep our eye on this dynamic for the next Report.

Inventory. The “months of inventory” indicator measures how long it would take to sell out the existing inventory of homes at the current rate of home sales. In the industry, we generally consider anything below six months as a signal for a seller’s market, where tight inventory leads to multiple offer situations, bidding wars, and ultimately appreciating prices. Morris has already crossed that threshold, which is what makes the decline in pricing so surprising. Given how tight inventory is, we do expect to see some meaningful appreciation in the spring market.

Negotiability. The negotiability indicators–the amount of time sold homes were on the market, and the rate at which sellers were able to retain their full asking price–tracked the decline in the pricing. Neither indicator showed the expected result: the days on market went up a tick, and the listing retention rate went down. In other words, sellers lost a little bit of negotiating leverage, a dynamic that doesn’t make any sense in a quarter where sales were up 17%. We think this is a short-term blip, and expect homes to sell more quickly and for closer to asking price in the spring market.

Going forward, we expect that Morris County’s sales activity will eventually have a meaningful impact on pricing. With homes still at historically affordable prices, interest rates low, and a generally improving economy, we believe that buyer demand will strengthen and drive more meaningful price appreciation in a robust spring market and throughout 2016.

The Morris County housing market sagged a bit in the fourth quarter, with only a modest increase in sales and basically flat prices. For the year, sales were up slightly, but we are still not seeing any meaningful price appreciation.

Sales. Morris County sales were essentially flat for the fourth quarter, rising 1.5% and finishing the year up 7.6%. This did mark the fifth straight quarter of year-on-year sales growth, and the market closed over 5,500 sales for the calendar year for the first time since the height of the seller’s market, so things are moving in the right direction. But compared to the other northern New Jersey county markets, Morris’s 2015 performance was relatively tepid.

Prices. Similarly, Morris pricing continued the trend of bouncing around a bit. For the quarter, the average price was up a tick and the median was down slightly. And for the year, the average was up and the median flat. That’s what we’ve basically seen over the last few years: prices up one quarter, down the next, the average up but the median down, etc. We’re not getting any clear read on where pricing in Morris is going, except that we remain confident if buyer demand continues to grow it will eventually start pushing prices up.

Negotiability. The negotiability indicators – the amount of time sold homes were on the market, and the rate at which sellers were able to retain their full asking price – were basically flat. The days-on-market rose slightly in the quarter and for the year, indicating that homes were taking just a little longer to sell. But sellers were getting slightly closer to the asking price, with the listing retention rate up a bit for both the quarter and the year. Again, like with sales and prices, the results were basically “meh” – no clear trend, no major movement one way or the other.

Going forward, despite the relatively lackluster results in 2015, we still believe Morris County is poised for serious growth. With homes still at historically affordable prices, interest rates low, and a generally improving economy, we expect that buyer demand will strengthen and drive more meaningful price appreciation in a robust spring market and throughout 2016.

Better Homes and Gardens Real Estate | Rand Realty, founded in 1984, is licensed in New York, New Jersey, and Connecticut. It is the No. 1 real estate brokerage in NY's Greater Hudson Valley with 26 offices serving Westchester, Rockland, Orange, Putnam, Dutchess, Ulster and Sullivan counties in New York and Bergen, Morris, Hudson and Passaic counties in New Jersey. Based on market share, Rand is the No. 3 real estate company in Westchester, No. 1 in Rockland and No. 1 in Orange. The company has more than 1,000 sales associates.

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